The Executive acknowledges that the Shares issuable under this Section 4(b) will be taken by himfor investment and not for distribution thereof and will not be sold or otherwise disposed of inviolation of the Securities Act of 1933 as amended and the rules and regulations promulgatedthereunder.(c) **Options.**If in any year the Executive receives an allotment of Bonus Shares under Section4(b) above, he shall also be entitled to receive options to purchase two times the number of BonusShares included in the allotment. The options shall be issued at the same time that the BonusShares are allotted and shall be exercisable at a per share purchase price equal to 100% of fairmarket value on the date of grant or 110% of fair market value if the Executive is the owner of 10%or more of the Company’s outstanding shares. Such options shall have a five (5) year duration andshall vest and become exercisable to the extent of one-third (1/3) of the options granted at theexpiration of each of the first three (3) years from the date of grant. The vested options shallbe exercisable only while Executive is employed by the Company or within thirty (30) days after anytermination of employment. The options shall contain anti-dilution protection in the event ofstock dividends and splits and such other provisions as are customary in option grants of thiskind.(d) **Specified Employee.**If the Executive is a “specified employee” of the Company within themeaning of Section 409A(a)(2)(B)(i) of the Internal Revenue Code (the “Code”) (or any successorprovision), no payment under this Section 4 or under the provisions for the deferral ofcompensation under the 2003 Agreement and 2008 Agreement in connection with the Executive’stermination of employment (other than a payment of salary through the date of such termination, andpayments on account of termination of employment by reason of death) shall be made until the datewhich is six (6) months after the date of the termination of the employment of the Executive (or,if earlier, the date of death of the Executive); provided further, if the Company determines basedupon written advice of counsel that any such payment if made during the calendar year that includesthe termination date would not be deductible in whole or in part by reason of Code § 162(m), suchpayment shall be made on January 2 of the following calendar year (or such later date as may berequired under the preceding proviso if the Executive is a “specified employee”).**5. Expenses.**During the New Employment Term, the Executive shall be entitled to receiveprompt reimbursement for all reasonable expenses incurred by him (in accordance with the policiesand procedures established from time to time by the Board of Directors of the Company) inperforming services hereunder, provided that such expenses are incurred and accounted for inaccordance with the policies and procedures established by the Company.**6. Other Benefits**. The Executive shall be entitled to the following additional benefits:(a) six weeks of paid vacation during each year of the term; it being understood and agreedthat Executive shall be entitled to take such additional paid vacation time as does not interferewith the performance of his duties hereunder and as are not reasonably objected to by the Company’sBoard of Directors.(b) Paid holidays in accordance with the Company’s usual holiday schedule plus eightadditional paid holiday, or personal days, to be taken at such time as the Executive determines ;it being understood and agreed that Executive shall be entitled to take such additional paidholidays or paid personal days as do not interfere with the performance of his duties hereunder andas are not reasonably objected to by the Company’s Board of Directors.(c) Such major medical, family health and dental coverage benefits and long-term disabilitygroup plan coverage generally available to the Company’s officers. To the extent the Executivequalifies, the Executive may participate in, or benefit under, any employee benefit plan,arrangement or perquisite made available by the Company to its key executives.(d) The Company shall reimburse the Executive for such ordinary and necessary business relatedexpenses as shall be incurred by the Executive in the course of the performance of his duties underthis Agreement.(e) A monthly car allowance in the amount of the monthly rental cost of a luxury sedan or itsequivalent plus expenses for business use.**7. Termination.**The Executive’s employment hereunder may be terminated under the followingcircumstances:(a) The Company shall have the right to terminate the employment of the Executive under thisAgreement for disability in the event the Executive suffers an injury, or physical or mentalillness or incapacity of such character as to substantially disable him from performing his dutieshereunder for a period of more than one hundred eighty (180) consecutive days upon the Companygiving at last thirty (30) days written notice of termination; provided, however, that if theExecutive is eligible to receive disability payments pursuant to a disability insurance policy orpolicies paid for by the Company, the Executive shall assign such benefits to the Company for allperiods as to which he is receiving payment under this Agreement.
 
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(b) This Agreement shall terminate upon the death of Executive.(c) The Company may terminate this Agreement at any time for “Cause” because of (i) his beingconvicted of criminal charges or violating such rules and regulations of the Securities andExchange Commission as may result in criminal action or material fines against the Company. (ii)Executive’s material breach of any term of this Agreement or (iii) the willful engaging by theExecutive in misconduct which is materially injurious to the Company, monetarily or otherwise;provided, in the case or (ii) or (iii), however, that the Company shall not terminate thisAgreement pursuant to this Section 7(c) unless the Company shall first have delivered to theExecutive a notice which specifically identifies such breach or misconduct, specifies reasonablecorrective action and the Executive shall not have cured the breach or corrected the misconductwithin fifteen (15) days after receipt of such notice.(d) The Executive may terminate his employment for “Good Reason” on five days writtennotice if: (ii) he is assigned, without his express written consent, any dutiesinconsistent with his positions, duties, responsibilities, authority and statuswith the Company as of the date hereof, or a change in his reportingresponsibilities or titles as in effect as of the date hereof, except inconnection with the termination of his employment by him without Good Reason; or (iii) his compensation is reduced or (iii) any purchaser or purchasers of substantially all of the businessor assets of the Company do not agree, at or prior to the closing of any suchtransaction, by agreement in form and substance satisfactory to the Executive toperform this Agreement in the same manner and to the same extent that the Companywould be required to perform if no sale was consummated.**8. Nondisclosure; Noncompetition.**(a) The Executive agrees not to use or disclose, either while in the Company’s employ or atany time thereafter, except with the prior written consent of the Board of Directors, any tradesecrets, proprietary information, or other information that the Company considers confidentialrelating to processes, suppliers (including but not limited to a list or lists of suppliers),customers (including but not limited to a list or lists of customers), compositions, improvements,inventions, operations, processing, marketing, distributing, selling, cost and pricing data, ormaster files utilized by the Company, not presently generally known to the public, and which is,obtained or acquired by the Executive while in the employ of the Company.(b) During his employment and for a period of two years thereafter, the Executive shall not,directly or indirectly; (i) in any manner, engage in any business which competes with any businessconducted by the Company (including any subsidiary) and will not directly or indirectly own,manage, operate, join, control or participate in the ownership, management, operation or controlof, or be employed by or connected in any manner with any corporation, firm or business that is soengaged (provided, however, that nothing herein shall prohibit the Executive from owning not morethan three percent (3%) of the outstanding stock of any publicly held corporation), (ii) persuadeor attempt to persuade any employee of the Company to leave the employ of the Company or to becomeemployed by any other entity, or (iii) persuade or attempt to persuade any current client or formerclient with leaving, or to reduce the amount of business it does or intends or anticipates doingwith the Company.(c) During his employment with the Company, and for two years thereafter, the Executive shallnot take any action which might divert from the Company any opportunity learned about by him duringhis employment with the Company (including without limitation during the New Employment Term) whichwould be within the scope of any of the businesses then engaged in or planned to be engaged in bythe Company.(d) In the event that this Agreement shall be terminated, then notwithstanding suchtermination, the obligations of the Executive pursuant to this Section 8 of this Agreement shallsurvive such termination.**9. Successors; Binding Agreement.**(a) The Company shall require any purchaser or purchasers of the Company or any purchaser orpurchasers of substantially all of the business or assets of the Company, by agreement in form andsubstance satisfactory to the Executive, to assume and agree to perform this Agreement in the samemanner and to the same extent that the Company would be required to perform it if no such purchasehad taken place. As used in this Agreement, “Company” shall mean the Company as hereinbeforedefined and any successor to its business or assets which executes and delivers the agreementprovided for in this Section 9(a) or which otherwise becomes bound by all the terms and provisionsof this Agreement by operation of law.(b) This agreement shall inure to the benefit of and be enforceable by the Executive’spersonal or legal representatives, executors, administrators, successors, heirs, distributees,devisees and legatees. If the Executive should die while any amount would still be payable hereunder if the Executive had continued to live, all such amounts, unlessotherwise provided herein, shall be paid in accordance with the terms of this Agreement to theExecutive’s devisee, legatee or other designee or, if there be no such designee, to the Executive’sestate.
 
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**10. Amendment; Waiver**. No provisions of this Agreement may be modified, supplemented, waivedor discharged unless such waiver, modification or discharge is agreed to in a writing signed by theExecutive and the Company. No waiver by either party hereto at any time of any breach by the otherparty hereto of, or in compliance with, any condition or provision of this Agreement to beperformed by such other party shall be deemed a waiver of similar or dissimilar provisions orconditions at the same or at any prior or subsequent time. No agreements or representations, oralor otherwise, express or implied, with respect to the subject matter hereof have been made byeither party which are not set forth expressly in this Agreement.**11. Applicable Law.**The validity, interpretation, construction and performance of thisAgreement shall be governed by the laws of the State of New Jersey without regard to its conflictof laws principles.**12. Severability of Covenants**. In the event that any provision of this Agreement, includingany sentence, clause or part hereof, shall be deemed contrary to law or invalid or unenforceable inany respect by a court of competent jurisdiction, the remaining provisions shall not be affected,but shall remain in full force and effect and any invalid and enforceable provisions shall bedeemed, without further action on the part of the undersigned, modified, amended and limited solelyto the extent necessary to render the same valid and enforceable.**13. Remedies.**(a) In the event of a breach or threatened breach of any of the Executive’s covenants underSection 8, the Executive acknowledges that the Company will not have an adequate remedy at law.Accordingly, in the event of any such breach or threatened breach, the Company will be entitled tosuch equitable and injunctive relief as may be available to restrain the Executive from theviolation of the provisions thereof.(b) Nothing herein shall be construed as prohibiting the Company, on the one hand, and theExecutive, on the other hand, from pursuing any remedies available at law or in equity for anybreach or threatened breach of the provisions of this Agreement by the other party, including therecovery of damages.(c) If the Company terminates this Agreement at any time without Cause (as defined above insection 7(c)) or the Executive terminates his employment for a Good Reason (as defined above inSection 7(d)), after January 1, 2008, the Executive shall be entitled under this Section 13(c) toreceive an amount equal to the amount of the compensation payments that, but for his termination ofemployment, would have been payable to the Executive under Section 4(a) as follows:   Termination under Section 13(c) Compensation under Section 4(a)   Within the first full calendar yearof the Executive’s employment an amount equal to the amount ofcompensation payments for 4 months   Within the second full calendar yearof the Executive’s employment an amount equal to the amount ofcompensation payments for 12 months   Within or after the third fullcalendar year of the Executive’semployment an amount equal to the amount ofcompensation payments for one 18month periodThe Executive shall also be entitled to the amounts of any bonus payments under§4(b) for the year of termination to the extent that targets were achievedprior to the date of termination.(d) The above amounts shall be deemed liquidated damages, and not a penalty. The Executiveshall not be required to mitigate the amount of any payment received pursuant to this paragraph norshall the amount payable under this paragraph be reduced by any compensation earned by theExecutive after the date of his termination of employment.
 
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**14. Notices.**Any notice, request, instruction or other document to be given hereunder by anyparty to the other party shall be in writing and shall be deemed to have been duly given whendelivered personally or five (5) days after dispatch by registered or certified mail, postageprepaid, return receipt requested, to the party to whom the same is so given or made:**If to the Company**       addressed to: Milestone Scientific Inc.45 KNIGHTBRIDGE ROADPISCATAWAY, NEW JERSEY 08854       with a copy to: Morse, Zelnick, Rose & Lander, LLP405 PARK AVENUE, SUITE 1401NEW YORK, NEW YORK 10022     **If to the Executive**         addressed to: Mr. Leonard Osser101 John Dietz RoadPO Box 228Callicoon Center, NY 12724or to such other address as the one party shall specify to the other party in writing.**15. Entire Agreement**. This Agreement sets forth the entire agreement of the parties heretoin respect of the subject matter contained herein and supersedes all prior agreements, promises,covenants, arrangements, communications, representations or warranties, whether oral or written, byany officer, employee or representative of any party hereto; and any prior agreement of the partieshereto in respect of the subject matter contained herein is hereby terminated and canceled.**IN WITNESS WHEREOF**, the parties have executed this Agreement on the date and year first abovewritten.      **MILESTONE SCIENTIFIC INC.**